One of the questions many ask as the electric and autonomous vehicles are introduced to market is: What happens with the “last mile” delivery? It can be the most expensive leg of deliveries. (PHoto: shutterstock)

One of the questions many ask as electric and autonomous vehicles are introduced to market is: What happens with the “last mile” delivery? It can be the most expensive leg of deliveries, especially in rural areas.

As with all logistics, efficiency is key. A big part of the cost of delivering “last-mile” packages is driver time—more than merely gasoline and dealing with vehicle maintenance. Who better to provide some fascinating and innovative solutions than a relatively small, Ohio-based manufacturer?

Workhorse’s business model revolves around fleet customers. UPS has now purchased well over 300 electric trucks from the company, and Workhorse is officially still a finalist to supply the new USPS vehicles. For automakers, especially startups, selling to fleets is a more compelling proposition than marketing to consumers. Once tested, fleet operators stand to buy hundreds of vehicles at once, and often enter into long-term business arrangements.

Consumers will soon know about Workhorse for its almost-market-ready electric trucks. The W15 has received considerable attention over the past several months with plans to make the $52,000 vehicle available this coming year.

The HorseFly, a delivery drone, launches from the roof of a vehicle to take the package to its final destination. The SureFly is another, perhaps more exotic innovation. It’s a hybrid-powered personal flying machine, a two-person helicopter with eight rotors, each powered by its own electric motor. A gasoline generator supplies power to the motors, and two lithium-ion battery packs act as backup. It’s not expected for FAA approval until at least 2019.

If this seems like a bit much for a startup that’s barely getting its toes wet in the automotive market, think again. For the next generation of vehicles it’s all about the battery.

Freightwaves reached out to Workhorse, and had an opportunity to speak with CEO Steve Burns. Burns is excited about the Horsefly drone in particular, and sees it in implementation as early as next month.

The Federal Aviation Administration (FAA) especially likes the use of drones in rural areas where there aren’t a lot of people on the ground. At the same time, it’s built to work within current FAA regulations, within their so-called “line of sight” rules.

What else is Workhorse working on? Automation for all of its vehicles. Anything involving safety, like braking, is implemented in all its ground vehicles.

The bottom line is that the “last mile” solutions are imminent, and it’s not just coming from the only other automobile startup, Tesla. There are numerous players, from the large to the small, and the prospects for the future are enormous—especially from a savings perspective. It’s only a matter of time until companies—and consumers—begin to see the obvious.

“Conventional gas-combustion engines average 5.5 miles per gallon for the UPS delivery trucks. The ‘stop and go’ nature of the delivery trucks grinds up transmissions, engines and brakes,” notes Burns.

The overall efficiency of the UPS Workhorse trucks is 500% more price efficient with all factors included. The upfront price of a standard Workhorse UPS delivery truck ranges between $60,000-$70,000.

“If you factor in fuel costs remaining what they are now, over the 20-year cycle of a vehicle’s life, the total cost of ownership stands to save the company $165,000 per vehicle,” says Burns.

“That’s with everything included, from the cost of the vehicle, to the need for a new battery after eight years. The maintenance and fuel costs are far less.”

With shipping rates rising across all sectors of the industry, including USPS’s intention to “mail in” higher rates, the next generation of long term and last mile solutions promises for an efficient and industrious short-and-long-term future.

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FreightWaves

FreightWaves provides data and commentary on the global freight market. At the core of each article or content piece is a focus on the economic impacts and outcomes - good or bad - that are driven by emerging technology, innovation and freight industry evolution.

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